3 The director of a nonprofit foundation that sponsors 8-week summer institutes for graduate students analyzed the costs and expected revenues for the next summer institute and recommended that the session be canceled In her analysis she included a share of the foundation’s overhead—the salaries of the director and staff and costs of maintaining the office—to the program She estimated costs and revenues as follows: Projected revenues (from tuition and fees) $300,000 Projected costs Overhead $ 50,000 Room and board for students $100,000 Costs for faculty and miscellaneous $175,000 Total costs $325,000 What was the error in the director’s recommendation? The table below shows the total cost of cleaning classrooms: Classrooms cleaned per evening Total cost 12 16 17 $100 $200 $300 $400 $500 $600 What is the average fixed cost of cleaning three classrooms? What is the average variable cost of cleaning three classrooms? What is the average fixed cost of cleaning seven classrooms? Attributed to Libby Rittenberg and Timothy Tregarthen Saylor URL: http://www.saylor.org/books/ Saylor.org 459